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Archive for Oil & Natural Gas

Drivers paying less at the pump due to free-falling oil prices can thank the U.S. energy boom for generating shale oil – and weakening OPEC’s ability to keep the cost of a gallon of gas high.

In just a matter of months, the price of a barrel of oil has dropped from more than $100 to about $70, and gas is now cheaper than it has been in years. But a recent report conducted for the American Petroleum Institute claimed oil would cost twice as much as it does now if it weren’t for America’s fracking boom, which wrings oil and natural gas out of shale miles underground.

But the next question could be whether the fracking industry can survive the low prices it brought.

OPEC, the cartel of oil-producing nations that has historically been able to calibrate the price of oil – and ultimately gasoline – by increasing or decreasing supply, announced Thursday that it won’t fight the price skid by cutting production this time. That likely means prices will continue to fall, and the more costly production technique of fracking could become cost-prohibitive, say experts.

Drivers have benefited in recent months from the falling prices, the API study found.

“This reduction in petroleum product prices have saved U.S. consumers an estimated $63 to $248 billion in 2013 and estimated cumulative savings of between $165 and $624 billion from 2008 to 2013,” stated the report.

An American Navy ship fired on a boat in the Persian Gulf today, killing one person and injuring three others aboard the craft, a U.S. naval official told ABC News.

A spokesperson for the Navys 5th Fleet, which is based in nearby Bahrain, said that a security team aboard the oil supply ship U.S.N.S. Rappahannock fired a .50 caliber machine gun at a “small motor vessel after it disregarded warnings and rapidly approached the U.S. ship” off the coast of Jebel Ali, a city approximately 30 miles from Dubai in the United Arab Emirates.

The Navy is investigating the incident as details continue to emerge. A Navy official said the offending vessel was a white pleasure craft, but a UAE official told ABC News it was a fishing boat with four Indians and two Emirates on board. There doesnt appear to be any indication the incident was terror-related, the UAE official said.

The Navy official said its not uncommon for Iranian speed craft to harass U.S. ships in the region, but in this case the boat wasnt Iranian.

“I cant emphasize enough that this has nothing to do with Iran,” the official said.

Just in time for Presidents Day: get ready for the long holiday weekend’s highest prices ever in Southern California as $4 gasoline is expected to arrive in Los Angeles, Long Beach, and probably Orange County, too.

That’s what energy analysts are predicting as the average price of a gallon of gasoline in the Los Angeles-Long Beach area reached $3.996 a gallon overnight, up nearly 2 cents since Thursday. That was also a jump of 15.9 cents a gallon since last week.

That’s according to the AAA Fuel Gauge Report, a daily record of credit card receipts compiled from more than 100,000 service stations around the U.S. by the Oil Price Information Service in New Jersey and by Wright Express.

Not far behind the L.A. area: San Diego is also on the brink at $3.992 a gallon, up 16.2 cents since last week, according to the report. Orange County was also on the cusp, rising 16.2 cents a gallon in the past week to an average of $3.989 a gallon.

American drivers are angry at having to pay $4 a gallon for gas, and understandably so. Their anger is often directed at the oil companies that supply the gas. It should be directed at Barack Obama instead.

In a move that has everyone from oil analysts to traders to petroleum producers scratching their heads, the Obama Administration announced on Thursday morning that the U.S. along with over two dozen other nations will release 60 million barrels of oil from emergency oil stock piles. Half of the total release, or 30 million barrels, will come from the U.S. Strategic Petroleum Reserve.

CATARINA, Tex. — Until last year, the 17-mile stretch of road between this forsaken South Texas village and the county seat of Carrizo Springs was a patchwork of derelict gasoline stations and rusting warehouses.

Now the region is in the hottest new oil play in the country, with giant oil terminals and sprawling RV parks replacing fields of mesquite. More than a dozen companies plan to drill up to 3,000 wells around here in the next 12 months.